Never Within Reach: Part II

In part two of Lee Daly's look at professional football in the Republic of Ireland (part one is here), the scale of financial troubles across the league are revealed.

In 2005, Jim Duffy, then manager of Dundee, returned from a scouting trip to Dublin to report that whilst a handful of players were possibly of SPL standard, the high wages they earned made them unattainable, with some of those on view earning around €50,000 a year - roughly equivalent to wages in the English League Two at the same time.

Where did the money come from? Well it certainly wasn’t through gate receipts. The average attendance for the SPL in the 05-06 season (minus the old firm) was a shade under 9,000 with the average attendance in England’s League Two at 4,194. Given clubs in both divisions have continued to struggle with financial difficulties paying around roughly similar wages, the League of Ireland’s average attendance in 2006 of 1,550 should have been enough to set alarm bells ringing.

TV money has never been a big money spinner for the league either with an improved deal announced in 2009 giving only €20,000 to each club in the top division and a €35,000 bonus for clubs featured six or more times.

With expenditure outstripping income by a considerable distance, clubs depended upon the value of their stadiums to keep themselves going. Given the massively inflated Irish property market at the time, as well as the fact that creditors other than the tax man were not willing to call in debts least it look like they were shutting down a football club, this strategy was successful to a point. After every season players would often move around clubs or be let go only for budgetary reasons only to return closer to kick off after budgets had been rejigged.

None of this dealt with the basic insolvency of the clubs and eventually something had to give. Shelbourne had been the biggest spenders so it was no surprise when they succumbed first. The club had agreed a deal with property developer Ossie Kilkenny to finance the club in return for a future option on Tolka Park, the ground Shelbourne owned the lease for and where they had played since 1989. However Kilkenny’s funding of the club was financed through drawing down on the future value of any deal on the stadium and even though Shelbourne won the title in 2006, throughout the season they had been the subject of several wind up orders from the revenue.

Unable to complete a deal for the ground with Kilkenny and weighed down by their debts, the club were eventually denied a license to compete in the Premier Division and relegated to the First Division, where they have remained since 2007.

Drogheda United, league champions in 2007, were put into examinership in 2008 after a stadium relocation deal also went badly wrong for them and relegation to the First Division was to follow two years later. Before kick off for the 2010 season, 2005 champions Cork City were wound up by the Revenue, with a supporters run club entering the First Division. Derry City were also denied a license after it was revealed it maintained hidden contracts with its players. Derry’s holding company was dissolved only for the club to return with the same name but a different ownership structure in the First Division.

Throughout this period Bohemians exercised a modicum of self control financially, and their prudence seemed to have paid off in September 2006 when they secured a deal with the property developer Liam Carroll worth €65 million to sell Dalymount Park, a ground they had played at since 1901, and relocate to a new stadium. They would go on to win the league in 2008 and 2009.

However the move came unstuck after a court case in October 2008, when another developer who had previously negotiated a deal was found to still have legal ownership of a section of the ground. Carroll’s company has since gone bust and the club is now looking to negotiate a settlement with its creditors, including players, which would allow it to keep afloat.

As the Republic of Ireland struggles with the legacy of economic mismanagement and huge levels of public and private debt, there will be little thought given to the plight of football clubs. To a certain extent this is justified, as there are far more pressing concerns for people to concentrate on.

However a recent disagreement over a friendly game involving Barcelona probably demonstrates the frustrations of fans of the League of Ireland perfectly. Limerick FC, a First Division club struggling to stay afloat like so many others, had signed an agreement with Barcelona for a friendly game which would feature Xavi and Lionel Messi. The FAI refused to sanction the game, citing fixture conflicts before eventually stating that under the terms of the agreement between the Association and the clubs it was able to make commercial decisions on their behalf and they had signed a deal with multinational company Endemol which gave them the rights to any friendly with attendance of over 15,000.

Limerick went public with their frustrations, as they had been informed by an FAI spokesperson that the limit was 20,000 rather than 15,000. In addition it also emerged the FAI were negotiating with Barcelona for a friendly of their own, badly needed due to the €45 million the Association had accumulated from building its own stadium. The dispute is currently due to go before the Irish High Court, though at the time of writing there are indications the parties may negotiate a settlement.

It is the sense of powerlessness on the part of fans at the behaviour of the Association and of many of the owners of the clubs that may be the lasting legacy. Professional football in the Republic of Ireland was built on using the economic value of property to prop up ludicrous investments which were never likely to make a return. Even despite the vast sums spent, European success and the mass following it was supposed to bring were never really in reach. Fans, players and administrators now need to negotiate what the limits of football in the Republic should be, and do their best to pick up the pieces of what went before.